Data presented by the Atlas VPN research team reveals that 31% of businesses in the U.S. are forced to close down as a consequence of falling victim to ransomware attacks.
The vast majority of firms experience substantial business impact due to ransomware attacks, including revenue loss and brand harm, unforeseen personnel cutbacks and even the shutdown of the business altogether, according to key findings in this new report.
The data is provided by Cybereason, a cybersecurity company that focuses on ransomware prevention. The survey sampled 1,263 cybersecurity professionals in April of 2021. The participants were from the United States (24%), the United Kingdom (24%), Spain (12%), Germany (12%), France (12%), the United Arab Emirates (8%) and Singapore (8%).
There were a variety of business sizes represented in the survey. Organizations with 500 or more employees (30%) were the most common, but there were also replies from companies with 250-500 employees (23%), 100-249 employees (25%), 50-99 employees (11%), 10-49 employees (10%) and fewer than 10 people (1%).
As many as 42% of organizations in the United Arab Emirates were forced to close down after a ransomware intrusion. The United Kingdom had 34% of companies halt their activities due to damages from a ransomware attack. The U.S. was next, at 31% of companies closing after an incident. Businesses in France (22%), Germany (21%) and Singapore (21%) saw similar closure rates. Spain had the lowest closure rate at 5% of organizations.
Worth noting is that there was no guarantee that paying ransom demands or having cyber insurance would prevent further ransomware intrusions or imply that the company will be able to recover all of the costs incurred as a result of a ransomware attack. Moreover, damages like reputational loss were not covered by cyber insurance but still significantly impacted businesses.
Employee and staff layoffs
Even though the majority of ransomware attacks do not result in business closure, a significant portion of companies were forced to eliminate some jobs. Layoffs did strongly depend on the industry, however.
For example, 50% of enterprises in the legal sector laid off employees after a ransomware attack. A close second was the retail industry, where 48% of ransomware victims had to let go of some workers. The automotive industry was also one of the most affected, with 42% of organizations reporting layoffs.
In fourth place, the manufacturing and technology sectors had nearly a third (29%) of ransomware victims forced to let go of a portion of their employees. Organizations in the health care industry were also not immune to layoffs, as 24% of them had to cut back on their workers. Close to them is the financial sector, where 23% of enterprises suffered layoffs after an attack.
Quite unexpectedly, respondents that worked in the government sector never encountered a situation where a person or a group of employees was fired because of a ransomware attack.
All in all, the findings are cause for concern. Most workers are not aware of the fact that one attack could mean not only layoffs but a total demise of the organization.
As always, preventive measures are the best when it comes to taking care of ransomware attacks. Initiatives such as employee training, mandatory operating system (OS) and software updates, and phishing scam simulations are of the utmost importance to keep your business safe and secure. The U.S. has already begun the conversation about cyber vulnerabilities with several recent initiatives, including launching the first one-stop resource to combat ransomware attacks.